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OECD Investment Policy Reviews: India 2009

This review of India's investment policy finds that India has made tremendous progress in building a policy environment to encourage investment. As a result, the country’s economy is growing more rapidly and FDI inflows have accelerated impressively. However, investment remains insufficient to meet India’s needs, particularly in infrastructure. Current efforts to strengthen and liberalise the regulatory framework for investment need to be intensified. India’s well-developed economic legislation should be implemented at an accelerated pace both at national level and right across India’s States and Union Territories.

OECD Investment Policy Reviews: India charts India's progress in developing an effective policy framework to promote investment for development, especially since the acceleration of economic reform from 1991 onward. It focuses on policies towards investment, trade, competition and other elements of the business environment. Finally, it outlines some of the challenges of implementing national-level reforms at state level.

Investment Policy

This chapter looks at the core elements of India’s investment policies. India has made substantial progress in creating a sound environment for all investments, whether small or large, domestic or foreign. The chapter analyses how India’s policies have evolved to embrace investment policy principles including transparency, property protection and nondiscrimination and suggests further reform in liberalising market restrictions and providing a predictable policy environment for investors. The analysis is structured around the questions set out in the Policy Framework for Investment (PFI). Each section is preceded by the relevant PFI question, which serves as general context for consideration of main policy areas.